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Tuesday, September 23, 2008

Study: Foreign homebuyers favor Florida in greater numbers

ORLANDO, Fla. – Sept. 23, 2008 – While a number of factors have contributed to a home sales decline in Florida, an increase in foreign homebuyers has modified the trend, according to a just-released research paper from the National Association of Realtors (NAR), the 2008 “Profile of International Home Buying in Florida.”

Foreign buyers recognize U.S. real estate as a desirable, profitable and secure investment. In addition, the weak dollar has made U.S. real estate an even more attractive investment.

NAR, in cooperation with the Florida Association of Realtors, conducted a survey of Florida Realtors, asking them about their experience working with international clients. This survey was conducted in August 2008, with a total of 4,859 responses received from Realtors who had completed more than 4,000 transactions involving a foreign buyer during the previous year.

More than half (53 percent) of the Realtors reported that they worked with an international client in the past 12 months. The typical Realtor in this group worked with three international clients, and about one in five (17 percent) worked with six or more international clients in the past year. More than one-quarter (28 percent) had one international client who purchased a property, and 15 percent reported two transactions within the past 12 months. Nearly one in five Florida Realtors who worked with international clients completed at least three home sales transactions.

Significance of the international market

One in 10 Realtors (12 percent) reported that an international client base made up 50 percent or more of their business. Half indicated that international clients accounted for 25 percent or less of their business.

The survey also asked FAR members if they’ve seen any change in their number of foreign clients. One-third of respondents noted an increasing share in the past two years, while just over half (52 percent) said that their share of international clients remained stable, neither increasing or decreasing.

Where they’re from

Although homebuyers come from all over the world, buyers from a few regions and countries had a higher demand for Florida property. FAR members reported that Canada buyers account for 27 percent of recent sales among foreign buyers. Buyers from the United Kingdom accounted for 21 percent; and the rest of Western Europe accounted for an additional 25 percent.

Latin America – defined for the report to include Mexico, the Caribbean nations, Central America and South America – accounted for 17 percent of recent sales to international clients. In addition to Canada and the United Kingdom, countries with a small but significant share of sales included Germany (7 percent), Venezuela (5 percent) and France (4 percent).

Where they bought

The Miami-Fort Lauderdale area was the most frequently reported location of a home purchased by a foreign buyer in Florida. One in five (21 percent) bought a home in the area, followed by one in 10 (11 percent) who purchased a home in the Orlando area. Sarasota, Tampa, Fort Myers and Naples rounded out the top six, accounting for at least 5 percent of purchases by foreign buyers.